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With Esso buy, Couche-Tard finally finds its domestic deal Add to ...

Couche-Tard gets the domestic deal it’s been looking for

By Tim Kiladze

For more than 15 years, Alimentation Couche-Tard Inc. has been forced to focus on acquisitions outside Canada because nothing major was for sale at home. The drought is finally over.

The retailer’s $1.7-billion acquisition of 279 Imperial Oil Esso stations in Ontario and Quebec is the transformative domestic deal Couche-Tard has been looking for.

Almost all of the acquired stations, located mostly in the Greater Toronto Area, come with valuable real estate that the company will now own. The stores are also much more productive than those Couche-Tard has been buying of late, which means there’s a better chance of juicing bigger profits.

On a conference call Wednesday, chief executive officer Brian Hannasch referred to the Esso stations as “the crown jewel of convenience retailing in Canada,” adding that Couche-Tard has “been pursuing these assets for close to three years.”

The deal extends a lengthy run of acquisitions for the retailer, including paying $2.8-billion (U.S.) for Statoil Fuel & Retail in 2012, $860-million for The Pantry Inc. in the southern United States in 2014, which added 1,500 stores in the U.S., and $635-million for Irish fuel retailer Topaz in 2015.

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Is Imperial building a war chest?

By Jeffrey Jones

Imperial Oil Ltd.’s service stations fetched far more in proceeds than any outsider had predicted. Now the question is, what will the oil company do with all that money?

The company unloaded the 497 Esso gas stations to five separate buyers across the country for $2.8-billion. That’s two to four times higher than many analysts had predicted when Imperial put them on the block more than a year ago.

It equates to an average of $5.6-million per site from the buyers: Alimentation Couche-Tard Inc., 7-Eleven Canada Inc., Parkland Fuel Corp., Harnois Groupe Petrolier and Wilson Fuel Co. Ltd.

TD Securities said it had previously estimated each to be worth $1-million to $2-million, albeit without knowing the minute details of each.

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Ex-Dragon Dickinson snags Weston with VC pitch

By Sean Silcoff

Former Dragons’ Den star Arlene Dickinson is raising a venture-capital fund to invest in consumer-packaged-goods startups backed by of one of biggest dragons in Corporate Canada: George Weston Ltd.

The giant food and retail conglomerate has agreed to kick in $5-million if Ms. Dickinson reaches her minimum target of $25-million, and to furnish an executive, Philip Shaw, former chief executive officer of Weston-owned Ace Bakery, to serve as a fund director. Ms. Dickinson is investing $1-million personally and said in an interview she was almost halfway toward her fundraising target.

“There’s a need in the marketplace for this fund,” which will focus on startups in the food and beverage, beauty, and health and wellness categories, she said.

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Bay Street’s big names become fintech backers

By Clare O’Hara

In Canada, the fintech sector has been slow to catch on – largely owing to slow-moving regulatory guidance and Canadian consumers’ commitment to existing financial service providers – in particular, Canada’s Big Five banks. But now, the space is being closely monitored by those same banks. Earlier this year, Canadian Imperial Bank of Commerce and First West Credit Union each partnered with fintech operations in the lending space.

Paul Desmarais Jr., chief executive officer of Power Financial Corp., was among the first to cast his eye on the fintech arena – with the company investing $30-million in robo-adviser Wealthsimple last year, and more recently joining Equitable Bank and Hedgewood in a $6.4-million investment in Borrowell.

At the same time, these startup companies – commonly referred to as industry disruptors – are attracting former Bay Street executives who are investing their own money into companies that may have once been seen as competitors.

Earlier this month, Anatol von Hahn, former group head of Canadian banking with Bank of Nova Scotia, joined the advisory board of robo-adviser Smart Money Capital Management Inc. Mr. von Hahn, who retired from his 31-year banking career last June, became a minority shareholder to the online portfolio manager after a number of discussions with founder and CEO Nauvzer Babul.

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RBC CEO’s compensation soars 44 per cent

By David Berman

Royal Bank of Canada's chief executive officer was paid $10.9-million in total compensation in 2015, his first full year as CEO, marking a 44-per-cent increase from the previous year.

Dave McKay, who became CEO in August 2014, received a salary of $1.3-million, along with a bonus of about $2.3-million and stock options valued at about $7.3-million.

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Scotiabank CEO's pay package totalled $9.3-million

By David Berman

Bank of Nova Scotia’s chief executive officer received compensation totalling $9.3-million in 2015, up nearly 5 per cent from the previous year.

Brian Porter received a salary of $1-million, unchanged from 2014. However, the value of his stock options rose to $6.5-million, up from $5.5-million in 2014, offsetting a smaller bonus of $1.8-million.

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ON THE MOVE

Caisse de dépôt et placement du Québec is gearing up to expand its emerging-market investments with a new office and hire. The pension plan has hired Anita Marangoly George to the new role of managing director of South Asia, setting up an office for the pension plan in New Delhi called CDPQ India. Story

Independent brokerage firm Paradigm Capital Inc. has hired John Booth as a senior mining investment banker. Mr. Booth is a long-time banker with significant bulge bracket experience behind him. Story

READING LIST

“Aesthetically, it’s neat to watch companies find capital market innovation lurking in almost 100 years of intricately linked legal regimes. So, yes, the world of unicorns is a world that’s making us ask questions about securities laws and fiduciary duties, and maybe a few investors will get gored by their unicorn pets. But the ability for private companies to access capital may also allow innovative companies to stay innovative.” Adrian Myers on unicorn valuations and corporate law. Story

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